January ___, 2011
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January
___, 2011
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
Bethesda,
Maryland 20814
Lazard
Capital Markets LLC
▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
New York,
New York 10020
Attn:
General Counsel
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Re:
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Initial
Public Offering
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Gentlemen:
This
letter (“Letter Agreement”) is being delivered to you in accordance with the
Underwriting Agreement (the “Underwriting Agreement”) entered into by and
between RLJ Acquisition, Inc., a Nevada corporation (the “Company”), and Lazard
Capital Markets LLC, as representative of the several underwriters (the
“Underwriters”), relating to an underwritten initial public offering (the
“Offering”), of 12,500,000 of the Company’s units (the “Units”), each comprised
of one share of the Company’s common stock, par value $0.0001 per share (the
“Common Stock”), and one warrant exercisable for one share of Common Stock
(each, a “Warrant”). The Units sold in the Offering shall be quoted and traded
on the Over-the-Counter Bulletin Board pursuant to a registration statement on
Form S-1 and prospectus (the “Prospectus”) filed by the Company with the
Securities and Exchange Commission (the “Commission”). Certain capitalized terms
used herein are defined in paragraph 12 hereof.
In order
to induce the Company and the Underwriters to enter into the Underwriting
Agreement and to proceed with the Offering and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned ▇▇▇▇▇▇ agrees with the Company as follows:
1. The
undersigned agrees that if the Company seeks stockholder approval of a proposed
Business Combination, then in connection with such proposed Business
Combination, it shall vote all Founder Shares in favor of such proposed Business
Combination.
2. The
undersigned hereby agrees that in the event that the Company fails to consummate
a Business Combination (as defined in the Underwriting Agreement) within 21
months from the closing of the Offering (or 27 months from the date of the
closing of the Offering if the Company executes a letter of intent, agreement in
principle or definitive agreement relating to a proposed initial Business
Combination before such 21-month period ends), he or she shall take all
reasonable steps to cause the Company to (i) cease all operations except for the
purpose of winding up, (ii) as promptly as reasonably possible, redeem 100% of
the Common Stock held by the Public Stockholders, at a per-share price, payable
in cash, equal to the aggregate amount including interest then on deposit in the
Trust Account, but net of any taxes payable (less up to $100,000 of such net
interest to pay reasonable expenses of dissolution), divided by the number of
shares of Common Stock then outstanding, together with the contingent right to
receive, in cash, following the Company’s dissolution, a pro rata share of the
balance of the Company’s net assets, if any, and (iii) as promptly as reasonably
possible following such redemption, subject to the approval of the Company’s
remaining stockholders and the Company’s board of directors, dissolve and
liquidate, subject in each case to the Company’s obligations under Nevada law to
provide for claims of creditors and other requirements of applicable
law.
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3.
(a) A
portion of the Founder Shares held by the undersigned in an amount equal to 2.5%
of the Company’s issued and outstanding shares immediately after the Offering
(inclusive of the shares issued to the underwriters in connection with the
exercise of their over-allotment option) shall be redeemed by the Company for
cancellation, for a purchase price per share equal to the par value thereof, in
the event that the last sales price of the Company’s stock does not equal or
exceed $12.00 per share (as adjusted for stock splits, stock dividends,
reorganizations, recapitalizations and the like) for at least one period of 20
trading days within any 30-trading day period within twelve (12) months
following the closing of the Company’s initial Business Combination. An
additional portion of the Founder Shares held by the undersigned in an amount
equal to 2.5% of the Company’s issued and outstanding shares immediately after
the Offering (inclusive of the shares issued to the underwriters in connection
with the exercise of their over-allotment option) shall be redeemed by the
Company for cancellation, for a purchase price per share equal to the par value
thereof, in the event that the last sales price of the Company’s stock does not
equal or exceed $13.00 per share (as adjusted for stock splits, stock dividends,
reorganizations, recapitalizations and the like) for at least one period of 20
trading days within any 30-trading day period between twelve (12) and
twenty-four (24) months following the closing of the Company’s initial Business
Combination.
(b) The
undersigned acknowledges that he or she has no right, title, interest or claim
of any kind in or to any monies held in the Trust Account or any other asset of
the Company as a result of any liquidation of the Trust Account with respect to
the Founder Shares held by him or her. The undersigned hereby further waives,
with respect to any shares of the Common Stock held by him or her, any
redemption rights he or she may have in connection with the consummation of a
Business Combination, including, without limitation, any such rights available
in the context of a stockholder vote to approve such Business Combination or in
the context of a tender offer made by the Company to purchase shares of the
Common Stock (although the undersigned shall be entitled to redemption and
liquidation rights with respect to any shares of the Common Stock (other than
the Founder Shares) he or she holds if the Company fails to consummate a
Business Combination within 21 months from the date of the closing of the
Offering (or 27 months from the date of the closing of the Offering if the
Company executes a letter of intent, agreement in principle or definitive
agreement relating to a proposed initial Business Combination before such
21-month period ends)).
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(c) To
the extent that the Underwriters do not exercise their over-allotment option to
purchase an additional 1,875,000 shares of Common Stock (as described in the
Prospectus), the undersigned agrees that he or she shall return to the Company
for cancellation, at no cost, the number of Founder Shares held by him or her
determined by multiplying 7,500 by a fraction, (i) the numerator of which is
1,875,000 minus the number of shares of the Common Stock purchased by the
Underwriters upon the exercise of their over-allotment option, and (ii) the
denominator of which is 1,875,000. The undersigned further agrees that to the
extent that (a) the size of the Offering is increased or decreased and (b) the
undersigned has either purchased or sold shares of the Common Stock or an
adjustment to the number of Founder Shares has been effected by way of a stock
split, stock dividend, reverse stock split, contribution back to capital or
otherwise, in each case in connection with such increase or decrease in the size
of the Offering, then (i) the references to 1,875,000 in the numerator and
denominator of the formula in the immediately preceding sentence shall be
changed to a number equal to 15% of the number of shares included in the Units
issued in the Offering and (ii) the reference to 7,500 in the formula set forth
in the immediately preceding sentence shall be adjusted to such number of shares
of the Common Stock that the undersigned would have to return to the Company in
order to hold 0.3% of the Company’s issued and outstanding shares after the
Offering (assuming the Underwriters do not exercise their over-allotment
option).
(d) In
the case of any of the Founder Shares owned by the undersigned that, as of the
date of determination, are not subject to forfeiture pursuant to paragraph 3(a)
above, until (A) one year after the completion of the Company’s initial Business
Combination or earlier if, subsequent to the Company’s initial Business
Combination (such applicable period being the “Founder Lock-Up Period”), the
last sales price of the Common Stock equals or exceeds $12.00 per share (as
adjusted for stock splits, stock dividends, reorganizations, recapitalizations
and the like) for at least one period of 20 trading days within any 30-trading
day period commencing at least 150 days after the Company’s initial Business
Combination or (B) the Company consummates a subsequent liquidation, merger,
stock exchange or other similar transaction which results in all of the
Company’s stockholders having the right to exchange their shares of Common Stock
for cash, securities or other property, and in the case of any of the Founder
Shares owned by the undersigned that, as of the date of determination, are
subject to forfeiture pursuant to paragraph 3(a) above, the undersigned shall
not, except as described in the Prospectus, (i) sell, offer to sell, contract or
agree to sell, hypothecate, pledge, grant any option to purchase or otherwise
dispose of or agree to dispose of, directly or indirectly, or establish or
increase a put equivalent position or liquidate or decrease a call equivalent
position within the meaning of Section 16 of the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission promulgated
thereunder, with respect to the Founder Shares owned by him or her, (ii) enter
into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of ownership of any of the Founder Shares
owned by him or her, whether any such transaction is to be settled by delivery
of the Common Stock or such other securities, in cash or otherwise, or (iii)
publicly announce any intention to effect any transaction specified in clause
(i) or (ii).
(e) Notwithstanding
the provisions contained in paragraph 3(d) herein, the undersigned may transfer
the Founder Shares owned by him, her or it (i) to the Company’s officers or
directors, any affiliate or family member of any of the Company’s officers or
directors or any affiliate of the Sponsor; (ii) by gift to a member of the
undersigned’s immediate family or to a trust, the beneficiary of which is a
member of the undersigned’s immediate family, an affiliate of the undersigned or
to a charitable organization; (iii) by virtue of the laws of descent and
distribution upon death of the undersigned; (iv) pursuant to a qualified
domestic relations order; (v) in the event of the Company’s liquidation prior to
the completion of the Company’s initial Business Combination; or (vi) in the
event that the Company consummates a liquidation, merger, stock exchange or
other similar transaction that results in all of its stockholders having the
right to exchange their shares of the Common Stock for cash, securities or other
property subsequent to the consummation of the Company’s initial Business
Combination; provided, however, that, in the case of clauses (i) through (iv),
these permitted transferees enter into a written agreement with the Company
agreeing to be bound by the transfer restrictions in 3(d) herein.
3
(f) Further,
the undersigned agrees that after the Founder Lock-Up Period has elapsed, the
Founder Shares owned by him or her shall only be transferable or saleable
pursuant to a sale registered under the Securities Act or pursuant to an
available exemption from registration under the Securities Act. The Company and
the undersigned each acknowledge that pursuant to that certain registration
rights agreement to be entered into between the Company and the Initial
Stockholders, each of the Founder and the Sponsor may request that a
registration statement relating to the Founder Shares be filed with the
Commission prior to the end of the Founder Lock-Up Period; provided, however,
that such registration statement does not become effective prior to the end of
the Founder Lock-Up Period.
4. During
the period commencing on the effective date of the Underwriting Agreement and
ending 180 days after such date, the undersigned shall not (i) sell, offer to
sell, contract or agree to sell, hypothecate, pledge, grant any option to
purchase or otherwise dispose of or agree to dispose of, directly or indirectly,
or establish or increase a put equivalent position or liquidate or decrease a
call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Commission promulgated thereunder, with respect to any Units, shares of Common
Stock, Warrants or any securities convertible into, or exercisable, or
exchangeable for, shares of Common Stock owned by him or her, (ii) enter into
any swap or other arrangement that transfers to another, in whole or in part,
any of the economic consequences of ownership of any Units, shares of Common
Stock, Warrants or any securities convertible into, or exercisable, or
exchangeable for, shares of Common Stock owned by him or her, whether any such
transaction is to be settled by delivery of such securities, in cash or
otherwise, or (iii) publicly announce any intention to effect any transaction
specified in clause (i) or (ii). Notwithstanding foregoing, the
undersigned may transfer the Units, shares of Common Stock, Warrants or any
securities convertible into, or exercisable, or exchangeable for, shares of
Common Stock owned by him, her or it (i) to the Company’s officers or directors,
any affiliate or family member of any of the Company’s officers or directors or
any affiliate of the Sponsor; (ii) by gift to a member of the undersigned’s
immediate family or to a trust, the beneficiary of which is a member of the
undersigned’s immediate family, an affiliate of the undersigned or to a
charitable organization; (iii) by virtue of the laws of descent and distribution
upon death of the undersigned; (iv) pursuant to a qualified domestic relations
order; (v) in the event of the Company’s liquidation prior to the completion of
the Company’s initial Business Combination; or (vi) in the event that the
Company consummates a liquidation, merger, stock exchange or other similar
transaction that results in all of its stockholders having the right to exchange
their shares of the Common Stock for cash, securities or other property
subsequent to the consummation of the Company’s initial Business Combination;
provided, however, that, in the case of clauses (i) through (iv), these
permitted transferees enter into a written agreement with the Company agreeing
to be bound by the transfer restrictions in this paragraph 4.
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5. The
undersigned’s biographical information furnished to the Company and attached
here as Exhibit A is true and accurate in all respects and does not omit any
material information with respect to the undersigned’s background. The
undersigned’s questionnaire furnished to the Company and attached hereto as
Exhibit B is true and accurate in all respects. The undersigned represents and
warrants that:
(a) the
undersigned is not subject to or a respondent in any legal action for, any
injunction, cease-and-desist order or order or stipulation to desist or refrain
from any act or practice relating to the offering of securities in any
jurisdiction;
(b) the
undersigned has never been convicted of, or pleaded guilty to, any crime (i)
involving fraud, (ii) relating to any financial transaction or handling of funds
of another person, or (iii) pertaining to any dealings in any securities and the
undersigned is not currently a defendant in any such criminal proceeding;
and
(c) the
undersigned has never been suspended or expelled from membership in any
securities or commodities exchange or association or had a securities or
commodities license or registration denied, suspended or revoked.
6. Except
as disclosed in the Prospectus, neither the undersigned nor any affiliate of the
undersigned, shall receive any finder’s fee, reimbursement, consulting fee,
monies in respect of any repayment of a loan or other compensation prior to, or
in connection with any services rendered in order to effectuate the consummation
of the Company’s initial Business Combination (regardless of the type of
transaction that it is), other than the following:
(a) repayment
of a $225,000 loan made to the Company by the Founder, pursuant to a Promissory
Note dated November 18, 2010;
(b) payment
of an aggregate of $10,000 per month to the Sponsor, for office space,
secretarial and administrative services;
(c) reimbursement
for any reasonable out-of-pocket expenses related to identifying, investigating
and consummating an initial Business Combination, so long as no proceeds of the
Offering held in the Trust Account may be applied to the payment of such
expenses prior to the consummation of a Business Combination, except that the
Company may, for purposes of funding its working capital requirements (including
paying such expenses), receive from the Trust Account up to $2,000,000 in
interest income (net of franchise and income taxes payable), in the event the
underwriters’ over-allotment option in the Offering is not exercised in full, or
$2,300,000 in interest income (net of franchise and income taxes payable), if
the underwriters’ over-allotment option in the Offering is exercised in full
(or, if the over-allotment option is not exercised in full, but is exercised in
part, the amount in interest income (net of franchise and income taxes payable)
to be released shall be increased proportionally in relation to the proportion
of the over-allotment option which was exercised); and
5
(d) repayment
of loans, if any, and on such terms as to be determined by the Company from time
to time, made by the Sponsor or an affiliate of the Sponsor or certain of the
Company’s officers and directors to finance transaction costs in connection with
an intended initial Business Combination, provided, that, if the Company does
not consummate an initial Business Combination, a portion of the working capital
held outside the Trust Account may be used by the Company to repay such loaned
amounts so long as no proceeds from the Trust Account are used for such
repayment; provided, however, that the Company may, for purposes of funding its
working capital requirements (including repaying such loans), receive from the
Trust Account up to $2,000,000 in interest income (net of taxes payable on such
interest), in the event the underwriters’ over-allotment option in the Offering
is not exercised in full, or $2,300,000 in interest income (net of taxes payable
on such interest), if the underwriters’ over-allotment option in the Offering is
exercised in full (or, if the over-allotment option is not exercised in full,
but is exercised in part, the amount in interest income (net of taxes payable on
such interest) to be released shall be increased proportionally in relation to
the proportion of the over-allotment option which was exercised).
7. The
undersigned acknowledges and understands that the Underwriters and the Company
will rely upon the agreements, representations, and warranties set forth herein
in proceeding with the Offering.
8. The
undersigned authorizes any employer, financial institution, or consumer credit
reporting agency to release to the Representatives and its legal representatives
or agents (including any investigative search firm retained by the
Representatives) any information they may have about the undersigned’s
background and finances (“Information”), purely
for the purposes of the Offering (and shall thereafter hold such information
confidential). Neither the Representatives nor its agents shall be
violating the undersigned’s right of privacy in any manner in requesting and
obtaining the Information and the undersigned hereby releases them from
liability for any damage whatsoever in that connection.
9. The
undersigned acknowledges and agrees that the Company will not consummate any
Business Combination with any company with which the undersigned has had any
discussions, formal or otherwise, prior to the consummation of the IPO, with
respect to a Business Combination.
10. The
undersigned acknowledges and agrees that the Company will not consummate any
Business Combination which involves a company which is affiliated with any of
the Founders unless the Company obtains an opinion from an independent
investment banking firm that the business combination is fair to the Company’s
stockholders from a financial perspective.
6
11. The
undersigned has full right and power, without violating any agreement to which
he or she is bound (including, without limitation, any non-competition or
non-solicitation agreement with any employer or former employer), to enter into
this Letter Agreement and to serve as an officer of the Company or as a director
on the board of directors of the Company, as applicable, and hereby consents to
being named in the Prospectus as an officer and/or as a director of the Company,
as applicable.
12. As
used in this Letter Agreement, (i) “Business Combination” shall mean a merger,
capital stock exchange, asset acquisition, stock purchase, reorganization or
similar business combination, involving the Company and one or more businesses;
(ii) “Founder” shall mean ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇; (iii) “Founder Shares” shall mean
the 3,593,750 shares of the Common Stock of the Company acquired by the Initial
Stockholders for an aggregate purchase price of $25,000, or approximately $0.007
per share, prior to the consummation of the Offering; (iv) “Public Stockholders”
shall mean the holders of securities issued in the Offering; (v) “Sponsor” shall
mean RLJ SPAC Acquisition, LLC; (vi) “Sponsor Warrants” shall mean the Warrants
to purchase up to 6,166,667 shares of the Common Stock of the Company that are
acquired by the Sponsor at a price per Warrant of $0.75 in a private placement
that shall occur simultaneously with the consummation of the Offering; and (vii)
“Trust Account” shall mean the trust fund into which a portion of the net
proceeds of the Offering will be deposited.
13. This
Letter Agreement, and the exhibits thereto, constitute the entire agreement and
understanding of the parties hereto in respect of the subject matter hereof and
supersede all prior understandings, agreements, or representations by or among
the parties hereto, written or oral, to the extent they relate in any way to the
subject matter hereof or the transactions contemplated hereby. This Letter
Agreement may not be changed, amended, modified or waived (other than to correct
a typographical error) as to any particular provision, except by a written
instrument executed by the parties hereto.
14. Neither
party may assign either this Letter Agreement or any of its rights, interests,
or obligations hereunder without the prior written consent of the other party.
Any purported assignment in violation of this paragraph shall be void and
ineffectual and shall not operate to transfer or assign any interest or title to
the purported assignee. This Letter Agreement shall be binding on the
undersigned and each of his or her heirs, personal representatives, successors
and assigns.
15. This
Letter Agreement shall be governed by and construed and enforced in accordance
with the laws of the State of New York, without giving effect to conflicts of
law principles that would result in the application of the substantive laws of
another jurisdiction. The parities hereto (i) agree that any action, proceeding,
claim or dispute arising out of, or relating in any way to, this Letter
Agreement shall be brought and enforced in the courts of New York, in the State
of New York, and irrevocably submits to such jurisdiction and venue, which
jurisdiction and venue shall be exclusive and (ii) waives any objection to such
exclusive jurisdiction and venue or that such courts represent an inconvenient
forum.
16. Any
notice, consent or request to be given in connection with any of the terms or
provisions of this Letter Agreement shall be in writing and shall be sent by
express mail or similar private courier service, by certified mail (return
receipt requested), by hand delivery or facsimile transmission.
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17. This
Letter Agreement shall terminate on the earlier of (i) the expiration of the
Founder Lock-up Period, or (ii) the liquidation of the Company; provided,
however, that this Letter Agreement shall earlier terminate in the event that
the Offering is not consummated and closed by March 31, 2011.
[Signature page
follows]
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Sincerely,
By:
_________________________
Name:
|
Acknowledged
and Agreed:
By:
_________________________
▇. ▇▇▇
▇▇▇▇▇▇▇▇
President
and Chief Executive Officer
[Signature Page to Letter Agreement
for Outside Directors]
Exhibit
A
(Attached)
Exhibit
B
(Attached)